The Affordable Care Act enables young adults to remain as dependents on their parents’ health insurance until age twenty-six, and recent evidence suggests that as many as three million young adults have gained coverage as a result. However, there has been no evidence yet on the policy’s effect on access to care, and questions remain about the coverage impact on important subgroups. Using data from two nationally representative surveys , comparing young adults who gained access to dependent coverage to a control group (adults ages 26-34) who were not affected by the new policy, we found sizable coverage gains for adults ages 19-25. The gains continued to grow throughout 2011 (up 6.7 percentage points from September 2010 to September 2011), with the largest gains seen in unmarried adults, nonstudents, and men. Analysis of the timing of the policy impact suggested that early gains in coverage were greatest for people in worse health. We found strong evidence of increased access to care because of the law, with significant reductions in the number of young adults who delayed getting care and in those who did not receive needed care because of cost.
When fully implemented, the Affordable Care Act is expected to increase the number of Americans with insurance by more than thirty million.1 The main drivers of this coverage expansion-increases in Medicaid eligibility (at states’ option) and tax credits for private health coverage purchased through health insurance exchanges-take effect in 2014. However, one provision of the law that has already been implemented allows people to remain as dependents on their parents’ private insurance policies until age twenty-six. This provision, which took effect for insurance plan renewals on or after September 23, 2010, extended coverage for many young adults by as much as seven years, depending on previous state regulations related to dependent insurance.
Many adults have already gained insurance under this Affordable Care Act provision, according to multiple sources.2-5 By one estimate, more than three million uninsured young adults gained coverage between September 2010 and December 2011.6 The pattern of coverage seems to be attributable to the law: More young adults became covered as dependents, and this increase was partially offset by a decrease in the number of young adults with private insurance in their own names.7
Evidence is mounting from several studies that this provision has raised rates of insurance among young adults.8-10 However, key questions remain: Which young adults were most likely to gain coverage? And, more important, did changes in coverage lead to improvements in access to care?
For several reasons, some young adults might benefit more from the law than others. Even before the policy went into effect, many insurers allowed full-time students to remain on their parents’ plans. This suggests that nonstudents might experience greater benefits from the law than other young adults.
Health status probably also plays a role. Prior to September 2010, for young adults without employer-sponsored or public insurance, the nongroup insurance market was the main option for purchasing coverage. People in poorer health face higher premiums and more restricted access to coverage in this market, and therefore they may be more likely to benefit from the new law.
The ultimate goal of this policy, however, was not only to increase coverage for young adults but also to improve access to care. Historically, access for young adults has often been disrupted by the loss of coverage when they “age out” of their parents’ plans.11 People without health insurance are more than four times as likely as others are to delay or defer obtaining needed medical care because of cost.12 Prior insurance expansions have improved access to care,13,14 although such gains have typically been via Medicaid or the Children’s Health Insurance Program rather than private insurance . To our knowledge, ours is the first study to examine whether the new policy affected access to care for young adults.
In this article we first document gains in coverage over the first year of the policy. Next we examine the policy’s effect across subgroups, hypothesizing greater gains for people with fewer coverage options before the Affordable Care Act, such as nonstudents and those in worse health. Finally, we test the hypothesis that the policy not only increased young adults’ insurance coverage but also improved their access to care.